Concealed data practices and competition law: why privacy matters

The degradation of consumer data privacy in the digital environment causes objective detriment to consumers and undermines the competitive process. Consumers are frequently unaware of the extent to which their personal data is collected and disclosed, and purposes for which it is used. A key reason is that firms often understate and obscure their actual data practices, preventing consumers from making informed choices. This article defines, and provides examples of, “concealed data practices”, which create objective costs and detriments for consumers, making them more susceptible to criminal activity, discrimination, exclusion, manipulation and humiliation. Aside from consumer protection and privacy regulatory responses, these practices should be of critical concern to competition authorities given their role in chilling privacy competition; preserving substantial market power by means other than superior efficiency; and deepening information asymmetries and imbalances in bargaining power. The article outlines five ways competition authorities should take account of these factors.